Rothe Company Manufactures and Sells a Single Product That It

question 93

Multiple Choice

Rothe Company manufactures and sells a single product that it sells for $90 per unit and has a contribution margin ratio of 35%.The company's fixed expenses are $46,800.If Rothe desires a monthly target net operating income equal to 15% of sales,the amount of sales in units will have to be (rounded) :

• A)1,486 units
• B)3,467 units
• C)1,040 units
• D)2,600 units

Comprehend the role of substitute goods in shaping supply decisions.

Grasp the concept of market equilibrium and the forces that drive towards it.

Understand the effects of demand changes on market equilibrium.

Interpret the consequences of changes in factors affecting demand and supply on market outcomes.

---

Definitions:

Cost

The amount of money required to purchase something or the expenditure incurred to produce something.

Markup Percent

The percentage by which the cost of a product is increased to determine its selling price.

Cost

The amount of money required to purchase something or the expense associated with creating a product or service.

Markup Percent

The proportion by which the price of an item is marked up to establish its retail price.